“Fama, Hansen, and Shiller have developed new methods for studying asset prices and used them in their investigations of detailed data on the prices of stocks, bonds and other assets. Their methods have become standard tools in academic research, and their insights provide guidance for the development of theory as well as for professional investment practice. Although we do not yet fully understand how asset prices are determined, the research of the Laureates has revealed a number of important regularities that are helping us to arrive at better explanations.”

Yale University’s Mr. Shiller is probably the best known to financial market participants thanks to his name being on the various Case-Shiller home price indexes which occasionally grab headlines, and for his book, ‘Irrational Exhuberance,’ which argued that the markets of the dotcom era were overvalued. Not a bad call as it turned out.

Mr. Fama, is another asset price obsessive. He’s a professor at the University of Chicago Booth School of Business, while Chicago further cements its long hold over market economics with the inclusion of Mr. Hansen in this year’s honors.

The past five years of financial crisis cruelly opened the world’s eyes to the farce of market asset pricing, notably in the field of more complex derivatives and sub-prime assets, as Lehman Brothers discovered back in 2008.

Of course, there are those who worry that markets remain seriously mis-priced to this day, as stocks refuse to budge far from multi-year highs despite the threat of shutdown and, possibly, debt default in the U.S. Beyond that, there is also cause to wonder how close any index would be to current levels without the comfort blanket of government stimulus. And that is a problem some five years after Lehman went under.